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Question

Difficulty: EasyAnti-Money Laundering (AML), KYC, and Sanctions Compliance

A retail client visits a broker-dealer branch and deposits $12,000 in physical currency into their brokerage account during a single business day. Which of the following filings is mandatory for the firm under federal Anti-Money Laundering (AML) and Bank Secrecy Act (BSA) rules?

  1. Currency Transaction Report (CTR)Answer
  2. B
    Suspicious Activity Report (SAR)
  3. C
    Office of Foreign Assets Control (OFAC) Sanctions Report
  4. D
    Regulation S-P Privacy Disclosure Notice

Answer

Currency Transaction Report (CTR)
Under the Bank Secrecy Act (BSA), broker-dealers must file a Currency Transaction Report (CTR) for any cash transaction (deposits, withdrawals, or currency exchanges) that exceeds $10,000 in a single business day.

Step-by-Step Solution

1
Identify the transaction type and amount
The client deposited $12,000 in physical currency (cash) in one business day.
Bank Secrecy Act rules differentiate between physical cash deposits and electronic transfers or checks.
2
Apply the monetary threshold rule under BSA/AML regulations
Cash transactions exceeding $10,000 require a Currency Transaction Report (CTR) filing with FinCEN within 15 calendar days.
The $10,000 threshold specifically triggers FinCEN Form 112 (CTR).

Key Concept

Currency Transaction Report (CTR) Thresholds
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Topics

Anti-Money Laundering (AML), KYC, and Sanctions Compliance